Recent reports describe hematopoietic abnormalities in mice with targeted instability of the mitochondrial genome. However, these abnormalities have not been fully described. We demonstrate that mutant animals develop an age-dependent, macrocytic anemia with abnormal erythroid maturation and megaloblastic changes, as well as profound defects in lymphopoiesis. Mice die of severe fatal anemia at 15 months of age. Bone-marrow transplantation studies demonstrate that these abnormalities are intrinsic to the hematopoietic compartment and dependent upon the age of donor hematopoietic stem cells. These abnormalities are phenotypically similar to those found in patients with refractory anemia, suggesting that, in some cases, the myelodysplastic syndromes are caused by abnormalities of mitochondrial function.